Bachelor Thesis Latvia’s Final Year Bachelor Students’ Emigration or Stay Intentions and Their Motivating Factors: Will They Stay or Will They Go? Authors: Elizabete Kalnozola Sintija Nīcgale Supervisor: Anna Zasova April 2017 Riga COPYRIGHT DECLARATION Names of the authors in full: Elizabete Kalnozola Sintija Nīcgale Title of the Thesis: Latvia’s Final Year Bachelor Students’ Emigration or Stay Intentions and Their Motivating Factors: Will They Stay or Will They Go? We understand that, in accordance with the Law of the Republic of Latvia regarding intellectual property rights we are the owners of the copyright in this thesis and that the copyright rests with us unless we specifically assign it to another person. We understand that the SSE Riga will deposit one copy of our thesis in the SSE Riga Library and it holds the primary right to publish our thesis or its parts in the SSE-Riga Student Research Papers series or in any other publication owned by SSE-Riga for two years from the date of our graduation. We assert our right to be identified as the authors of this thesis whenever the thesis is reproduced in full or in part. ____________________ ____________________ /Sintija Nīcgale/ /Elizabete Kalnozola/ 07.04.2017. Table of Contents Abstract ..................................................................................................................................... 5 1. Introduction .......................................................................................................................... 6 2. Literature review ............................................................................................................... 10 2.1. Literature on emigration intentions ....................................................................................... 10 2.2. Literature on emigration ......................................................................................................... 12 2.3. Literature on remigration ....................................................................................................... 13 2.4. Overview of literature review ................................................................................................. 14 3. Methodology ....................................................................................................................... 15 3.1. Sample selection ....................................................................................................................... 15 3.2. Survey ....................................................................................................................................... 15 3.2.1. Characteristics of stayers and leavers ............................................................................ 16 3.2.2. Analysis of future migrants ............................................................................................. 16 3.2.3. Factors influencing both stayers and leavers ................................................................. 17 3.3. Data collection .......................................................................................................................... 17 3.4. Empirical approach ................................................................................................................. 18 3.4.1. Characteristics of stayers and leavers ............................................................................ 18 3.4.2. Analysis of future migrants ............................................................................................. 21 3.4.3. Analysis of factors influencing both stayers and leavers .............................................. 21 4. Analysis of results .............................................................................................................. 22 4.1. Sample description .................................................................................................................. 22 4.1.1 Characteristics of stayers and leavers ............................................................................. 23 4.1.2 Regression analysis ............................................................................................................ 25 4.2. Analysis of future migrants .................................................................................................... 26 4.3. Factors influencing both stayers and leavers ........................................................................ 27 4.3.1. Home country evaluation ................................................................................................. 27 4.3.2. Push-pull factors ............................................................................................................... 28 5. Discussion of Results .......................................................................................................... 30 5.1. Research questions .................................................................................................................. 30 5.1.1. Emigration intentions ...................................................................................................... 30 5.1.2. Characteristics of stayers and leavers ............................................................................ 31 5.2. What should be done? ............................................................................................................. 37 5.3. Limitations ............................................................................................................................... 38 6. Conclusions ......................................................................................................................... 40 7. References ........................................................................................................................... 42 8. Appendices .......................................................................................................................... 45 Appendix A. List of universities in Latvia .................................................................................... 45 Appendix B. Survey questionnaire ................................................................................................ 47 Appendix C. Migration - reasons and barriers (Question 19-23) ............................................... 52 Appendix D. Correlation analysis ................................................................................................. 54 Appendix E. Sample distribution of universities ......................................................................... 55 Abstract Considering the continuous decline in population due to the high emigration flows in Latvia, we aimed to study the remaining human capital and their intentions to emigrate in the upcoming 2 years with a focus on assumingly the most economically important group of people – young and educated. We aimed to recognize the emigration intentions among young and educated, understand the differentiating characteristics among stayers and leavers, get insights into the plans of leavers, and highlight the aspects that need to be improved to decrease emigration levels in Latvia. A survey for data collection was distributed among final year bachelor students in Latvian universities. The results were analyzed using a probability regression and descriptive statistics. The main findings were that 50% of current students have an intention to migrate within the next two years, and 29.9% of them do not have an intention to return to Latvia. Having C level in English, previous working abroad experience, and financing studies using personal funds positively influence the decision to migrate, while being currently employed and having received a study grant positively influences the intention to stay. Income, education and employment opportunities have the strongest effect on the intention to migrate. We have concluded that reorganization of the taxation system, improvements in the health care system, and assessment of the starting salary ranges with provision of better career opportunities by the private sector could potentially change the plans of young and educated to leave Latvia or put them off forever. 5 1. Introduction Migration issue has been one of the central topics year after year for general public, policymakers, and business community since Latvia regained its independence in 1990. 2.65 million people gained an independent country 25 years ago, and today only 1.96 million inhabit the territory of Latvia, according to Central Statistical Bureau (2016) estimates. Certainly, globalization of countries has opened plethora of new opportunities for individuals and businesses on an international scale. However, it is necessary not only to acknowledge the gains, but also to manage the negative sides of globalization, for example, potential shrinkage of population due to high emigration flows for small population countries. This other side of the coin is the focus of the study in the case of Latvia. Particularly, we consider emigration or stay intentions and their motivating factors among final year Bachelor students. The topic of the research and the specific target group has been chosen due to a couple of motivating reasons. First, the demographic situation in Latvia is far from satisfying. Since 1991 natural growth rate and net migration has been negative, and 2015 net change in population is still lower than in 2007 before the crisis (CSP, 2016a). Every year on average 23’179 people leave the country